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November 23, 1999
Dear :
I want to announce an important change at Skyline that will help us better serve
your investment needs. The Skyline Funds Board of Trustees has approved a
proposal to merge Small Cap Value Plus and Small Cap Contrarian into Special
Equities Portfolio.
We believe that our clients will benefit from the concentration of Skyline's
resources into a single investment strategy. The key advantage is that all the
firm's investment talent will be brought to bear on a single product. This
consolidation will further strengthen the depth and breadth of our equity
analysis and our decision-making. Also, fewer stocks will be owned throughout
the firm, thus allowing for increased analysis on each holding.
Why do this now? The competition in investment management, including small cap,
continues to increase. Pooling our firm's resources instead of sharing them
across services will help us better meet the challenges of a highly competitive
investment environment.
What will be the role of the Small Cap Value Plus staff if the shareholders
approve this merger with Special Equities Portfolio? The Small Cap Value Plus
investment professionals will continue evaluating stocks with low P/E ratios and
good earnings growth as part of the Special Equities Portfolio management team.
Small Cap Value Plus and Special Equities Portfolio have always shared a similar
investment philosophy and have co-owned many of the same securities. The Small
Cap Value Plus staff will recommend selected stocks for purchase and review
their recommendations as always with the entire investment team. Ken Kailin will
work closely with Bill Dutton, the 15-year-tenured manager of Special Equities
Portfolio.
Your clients will be receiving a prospectus supplement, one is attached for your
review, and in early January a proxy will be mailed to all shareholders of Small
Cap Value Plus and Small Cap Contrarian, asking for approval of the
reorganization. A copy of the preliminary proxy statement/prospectus relating to
the reorganization is attached. The information in the preliminary proxy
statement/prospectus is not complete and may be changed. We are not now
requesting a proxy and please do not send one at this time. A definitive proxy
statement/prospectus will be sent to you on or about January 10, 2000.
We are confident about the benefits this merger will bring. I would be happy to
discuss any questions you may have, please call me at 888-759-3863.
Sincerely,
Michele M. Brennan
Vice President
Director of Fund Marketing
Attachment
<PAGE>
November 23, 1999
Dear :
I want to announce an important change at Skyline that will help us better serve
your investment needs. The Skyline Funds Board of Trustees has approved a
proposal to merge Small Cap Value Plus and Small Cap Contrarian into Special
Equities Portfolio.
We believe that our clients will benefit from the concentration of Skyline's
resources into a single investment strategy. The key advantage is that all the
firm's investment talent will be brought to bear on a single product. This
consolidation will further strengthen the depth and breadth of our equity
analysis and our decision-making. Also, fewer stocks will be owned throughout
the firm, thus allowing for increased analysis on each holding.
Why do this now? The competition in investment management, including small cap,
continues to increase. Pooling our firm's resources instead of sharing them
across services will help us better meet the challenges of a highly competitive
investment environment.
Will the investment process of Special Equities Portfolio change? No.
Bill Dutton, the portfolio manager, will continue his active involvement in the
research process. Skyline's analysts have always been active contributors in the
decision-making process. All stock purchases have required a review by the
entire investment staff. The investment staff's critique of new ideas will
continue as a required element of the firm's decision-making procedures.
Shareholders of Special Equities Portfolio will receive a supplement to the
prospectus, which discusses the proposed merger. I have attached a copy for your
review. A copy of the preliminary proxy statement/prospectus relating to the
reorganization is also attached. The information in the preliminary proxy
statement/prospectus is not complete and may be changed. We are not now
requesting a proxy and please do not send one at this time. A definitive proxy
statement/prospectus will be sent to you on or about January 10, 2000.
We are confident about the benefits this merger will bring. I will call soon to
ensure your receipt of this information and to answer any questions you may
have.
Sincerely,
Michele M. Brennan
Vice President
Director of Fund Marketing
Attachment
